Friday, February 13, 2015

Greek Debt Standoff Awaits a Decisive Move

Clad in snug black pants and his signature untucked shirt, the Greek finance minister, Yanis Varoufakis, sauntered into a conference room in the Berlin headquarters of the German finance ministry.

Seated in a wheelchair awaiting him was Germany’s dour and all-powerful finance chief, Wolfgang Schäuble. The personification of fiscal discipline, Mr. Schauble was flanked by several officials, dossiers at the ready.

With Greece about to run out of money and in need of German support for emergency funds, Mr. Varoufakis appeared to be outmanned and outgunned. Nonetheless, he was the one who delivered the ultimatum in the meeting: Renegotiate Greece’s €240 billion bailout deal or risk a mutually destructive disaster.

Mr. Schäuble’s answer was a firm “no.” Greece must follow the rules. It was a response repeated by eurozone finance ministers during tense debt talks in Brussels this week, a showdown that will continue on Monday.

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This blog is dedicated to the understanding of the current Greek (but also European) economic, political and institutional crisis. It was created by Prof. Aristides Hatzis of the University of Athens, after many requests by his students who seek a source of reliable analysis on the Greek current affairs. Its aim is to post commentary and reports published mainly in the major U.S. and European media and to encourage a rigorous discussion.